Making an informed decision about VUL life insurance requires more than a cursory glance at marketing brochures. Here are some steps to consider:

1) Assess Your Coverage Needs

Determine the coverage amount that aligns with your family’s or business’s financial protection requirements. Some people seek just enough to cover final expenses, while others want enough coverage to replace income, settle debts, or handle potential estate taxes.

2) Clarify Your Investment Goals and Risk Tolerance

Ask yourself: are you comfortable with market swings? If you’re hoping for guaranteed, predictable gains, VUL might not be the best fit. If you’re prepared for potential volatility in exchange for possibly higher returns, it could be suitable.

3) Compare Policies

Solicit illustrations from multiple insurers, paying close attention to fee breakdowns, subaccount options, and surrender charges. The difference in fees alone can significantly affect net growth. Also, check how often you can rebalance or switch subaccounts without penalty.

4) Understand the Illustrations Provided

Insurance companies typically show best-case, mid-case, and worst-case scenarios for subaccount returns. While these are hypothetical, they highlight how sensitive the policy can be to market performance. Focus on the mid- or conservative-case scenarios for a realistic picture.

5) Consult Professionals

Besides an insurance agent, consider talking to a fee-based financial planner or tax expert who can offer an unbiased viewpoint on whether a VUL policy aligns with your broader portfolio and tax situation. Advisors with credentials in both insurance and investment can help clarify the intricacies.